No, The Movie Theater Industry is Not Dead
NO, THE MOVIE THEATER INDUSTRY IS NOT DEAD. You might have read recently about the bankruptcy filing of Cineworld, the U.K.-based parent company of Regal Cinemas, as well as its decision to reject leases at 39 of its roughly 500 multiplexes across the U.S., including some prominent urban / Downtown locations like Manhattan’s Union Square Stadium 14, Boston’s Fenway Stadium 13, D.C.’s Gallery Place Stadium 14, Miami Beach’s South Beach Stadium 18 and Seattle’s Meridian 16. Yet this is not simply a manifestation of streaming’s inexorable rise. Rather, the roughly 30% decline in overall domestic box office sales in 2022 versus 2019 closely tracks the reduction in the number of films that studios brought to market last year, a hangover of pandemic-era work slowdowns and release strategies. Indeed, moviegoers showed that they would return if given a reason to, as they did in droves over the late spring and early summer for major hits like “Top Gun: Maverick” and “Jurassic: World Domination.” Moreover, the studios — with the exception of Netflix — have started to retreat on digital-oriented distribution schemes that had appeared to take hold during the pandemic, as investors prioritize profitability over subscriber growth and the streaming-first approach struggles to achieve desired returns, especially with big-budget releases. It is also worth noting that Cineworld entered the pandemic already deep in debt and has been criticized for a slow adoption of recliner seating. Brick-and-mortar cinema still faces a great deal of uncertainty — AMC is dealing with heavy indebtedness as well — but, especially in light of its resilience over the last century, I would not count it out just yet.